Liquid Fuels Market Module - NEMS Documentation

June, 2022

Introduction

Purpose of this report

The purpose of this report is to define the objectives of the Liquid Fuels Market Module (LFMM), describe its basic approach, and provide details on how it works. This report is a reference document for model analysts and users. It is also a tool for model evaluation and improvement. Documentation of the model is in accordance with EIA's legal obligation to provide adequate documentation in support of its models (Public Law 94-385, section 57.b.2). An overview of the LFMM and its major assumptions is available in two related documents: Annual Energy Outlook 2022 (Appendix E) and Assumptions to the Annual Energy Outlook 2022. This volume documents the version of the LFMM used for the Annual Energy Outlook 2022 (AEO2022) and supersedes all previous versions of the LFMM documentation.

Model summary

The LFMM models petroleum refining activities, the marketing of petroleum products to consumption regions, imports and exports of petroleum liquids, the distribution of natural gas liquids from natural gas processing plants, and the production of renewable fuels (including ethanol, biomass-based diesel, and cellulosic biofuels) and non-petroleum fossil fuels (including coal-to-liquids and gas-to-liquids). The LFMM projects domestic petroleum product prices and movement of liquid fuel quantities for meeting petroleum product demands by supply source, fuel, and region. These liquid fuels include:

• Domestic, imported, and exported crude oil
• Alcohols, biomass-based diesel, and other biofuels
• Domestic natural gas plant liquids
• Petroleum product imports and exports
• Unfinished oil imports and export

In addition, the LFMM estimates domestic refinery capacity expansion and fuel consumption. Product prices are estimated at the census division (CD) level, while much of the liquid fuels production activity information is at the level of Petroleum Administration for Defense Districts (PADDs) and sub-PADDs.

Model archival citation

The LFMM is archived as part of the National Energy Modeling System (NEMS) for AEO2022. The model contact is

Peter Colletti
U.S. Energy Information Administration
U.S. Department of Energy
1000 Independence Avenue SW
Washington, DC 20585
(202) 586-2223

Organization of this report

The remainder of this report is organized in the following chapters: Model Purpose; Model Rationale;Model Structure; Appendix A, Data and Outputs; Appendix B, Mathematical Description of Model;Appendix C, Bibliography; Appendix D, Model Abstract; Appendix E, Data Quality; Appendix F, Estimation Methodologies; and Appendix G, Historical Data Processing.